Commercial Bank of California Marks a Year of Continued Growth & Profitability in 2024
Highlights Include:
- Completion of Community Bank of the Bay merger plus ongoing organic growth led total assets, deposits, investment securities, and loans to increase over prior-year levels to new record highs
- Net interest income increased year-over-year, representing the highest annual net interest income in CBC history
- Liquidity and capital strength remain sources of stability and flexibility to deal with challenging times
IRVINE, CALIF. (April 17, 2025) – Commercial Bank of California (“CBC” or “Bank”), a BauerFinancial Four-Star Excellent Bank, today reported net income of $15.7 million for full year 2024, an increase from the $15.1 million recorded in 2023. For the fourth quarter of 2024, the Bank’s net income was $232 thousand, a decrease of $4.8 million from the net income of $5.0 million earned in the fourth quarter of 2023. While most income statement components evidenced solid growth in 2024 compared to the prior year, one-time expenses related to the Community Bank of the Bay (“CBB”) merger of $10.6 million for the full year and $9.7 million for the fourth quarter of 2024 (including the establishment of an allowance for credit losses for non-PCD (purchased credit deteriorated) loans acquired in the merger) resulted in only a slight increase in annual profitability and a significant decline in fourth quarter results.
Full year 2024 net interest income increased by 28.1%, or $19.1 million, to $87.1 million from $68.0 million in the prior year primarily due to growth in earning assets combined with an expansion of net interest margin. Provisions for credit losses totaled $9.6 million in 2024 versus $6.2 million for 2023, reflecting the need to keep pace with overall loan growth (including the purchased CBB loans) and higher net charge-offs on consumer loans. The 2023 provision for credit losses also included the writeoff of a failed bank’s subordinated debt. In general, credit quality and borrower performance remained strong in 2024, due to a selective and disciplined approach to lending, strong client relationships, and a realistic and proactive approach to credit management.
Fourth quarter 2024 net income declined compared to the preceding quarter, down $5.1 million (95.7%) to $232 thousand from $5.4 million in 2024’s third quarter. As with CBC’s full year 2024 performance, all revenue components experienced robust growth due to higher levels of earning assets, with the quarterly decline attributable to the one-time merger-related expenses cited earlier.
At December 31, 2024 CBC’s total assets of $3.5 billion were $1.1 billion, or 45.8%, above the $2.4 billion in total assets that existed at the end of 2023. Net loans rose from $1.7 billion at the end of 2023 to $2.5 billion on the corresponding date in 2024, an increase of $777.1 million, or 45.5%. Deposits also rose, to $2.9 billion at December 31, 2024 compared to $1.9 billion at the end of 2023, an increase of $966.9 million (51.2%). While CBC continued to experience substantial organic growth throughout 2024, the CBB merger accounts for much of the overall balance sheet increase.
Total capital at December 31, 2024 was $291.8 million, a sharp increase of $121.9 million from $169.9 million at the same point in 2023. Total capital for both years was diminished by unrealized after-tax losses on securities available for sale due to elevated interest rates. CBC’s Tier 1 Leverage Ratio stood at 9.50% at the end of 2024, which is an increase of 1.32% from 8.18% at the end of 2023. All of the Bank’s capital ratios continued to exceed the current standards for well-capitalized institutions, the highest capital category established by banking regulators.
Ash Patel, Chairman, President, and Chief Executive Officer, commented: “2024 was a year of continued achievement for CBC, but without question our brightest accomplishment of the year was the completion of our acquisititon and merger with Community Bank of the Bay. The combination of our two banks increased CBC’s total assets by close to a billion dollars, added four strategically-located regional offfices in the greater San Francisco Bay area, and most importantly brought a host of valued clients and skilled bankers to the CBC family. While the merger is already reflected in our financial statements, much work remains as we continue the system conversions and other actions that will create One Bank For All Of California. In the meantime, we continue to share our joint banking expertise with clients and prospects in California’s two largest banking markets.”
He continued: “Of course, CBC’s 2024 accomplishments extend far beyond the Community Bank of the Bay merger. Our net interest income reached record levels once again, as did revenues from our payments processing busineses. Operating expenses rose overall, but continued to be moderated by discipline and effective cost control. With the one-time merger-related expenses largely behind us, we look forward to continued earnings improvement in the future. The elements that have long served as the basis of CBC’s success – earning asset growth, leading to expansion of net interest income, all built on a foundation of solid asset quality – will drive our results in 2025 and beyond.
Mr. Patel concluded: “CBC’s success in 2024 is a reminder of the primacy of client relationships and prudent financial management. These principles must and will remain central to CBC’s activities going forward, just as they have in the past. The financial strength evident in CBC’s balance sheet and income statement positions us well to deal with uncertainty and capitalize on opportunity when they inevitably emerge. But we will never forget that our current success and bright future would not be possible without the the steadfast loyalty and support of our clients, team members, and friends.
About Commercial Bank of California
Commercial Bank of California is a full-service bank and diversified financial services company serving businesses, professionals, and communities in the greater Los Angeles and San Francisco Bay areas of California. Recognized as a BauerFinancial, Inc. “Four-Star Excellent Bank” for its financial strength and stability, CBC provides the financial expertise of a major bank while maintaining a commitment to personalized service for every CBC client. More information about CBC’s custom solutions for your banking needs is available at www.cbcal.com.
STATEMENTS OF CONDITION (UNAUDITED)
| ($000’s omitted) | Dec. 31, 2024 | Dec. 31, 2023 | ||
|---|---|---|---|---|
| ASSETS: | ||||
| Cash and due from banks | $ | 36,274 | $ | 15,638 |
| Interest bearing deposits with banks | 356,046 | 161,691 | ||
| Federal funds sold | – | – | ||
| Cash and cash equivalents | 392,320 | 177,329 | ||
| Investment securities | 513,828 | 446,160 | ||
| Loans | 2,514,473 | 1,726,102 | ||
| Less: allowance for loan and lease losses | 30,497 | 19,257 | ||
| Loans, net | 2,483,976 | 1,706,845 | ||
| Premises and equipment – net | 13,343 | 9,223 | ||
| Other real estate owned | – | – | ||
| Accrued interest receivable and other assets | 134,093 | 85,961 | ||
| Total assets | $ | 3,537,560 | $ | 2,425,518 |
LIABILITIES AND CAPITAL:
| ($000’s omitted) | Sept. 30, 2024 | Sept. 30, 2023 | ||
|---|---|---|---|---|
| Non-interest bearing demand deposits | $ | 1,146,712 | $ | 823,477 |
| Interest bearing demand deposits | 371,739 | 212,477 | ||
| Savings and money market deposits | 942,813 | 684,202 | ||
| Time deposits | 395,895 | 170,085 | ||
| Total deposits | 2,857,159 | 1,890,241 | ||
| Fed funds purchased | – | 90 | ||
| Other borrowings | 344,435 | 335,000 | ||
| Accrued interest payable and other liabilities | 44,157 | 30,273 | ||
| Total liabilities | $ | 3,245,751 | $ | 2,255,604 |
| Stated capital | 228,622 | 122,342 | ||
| Retained earnings | 93,537 | 77,799 | ||
| Accumulated other comprehensive income | –30,350 | -30,227 | ||
| Total capital | $ | 291,809 | $ | 169,914 |
| Total liabilities and capital | $ | 3,537,560 | $ | 2,425,518 |
STATEMENTS OF OPERATIONS (UNAUDITED)
| ($000’s omitted) | 12 Months Ended Dec. 31, 2024 |
12 Months Ended Dec. 31, 2023 |
||
|---|---|---|---|---|
| Interest on loans | $ | 116,549 | $ | 89,643 |
| Interest on deposits with banks | 17,260 | 8,343 | ||
| Interest on investment securities | 13,707 | 12,019 | ||
| Other interest income | 1,240 | 823 | ||
| Total interest income | 148,756 | 110,828 | ||
| Interest on deposits | 47,792 | 33,037 | ||
| Interest on other borrowings | 13,914 | 9,833 | ||
| Total interest expense | 61,706 | 42,870 | ||
| Net interest income | 87,050 | 67,958 | ||
| Provision for loan losses | 9,610 | 6,167 | ||
| Net interest income after provision for loan losses | 76,440 | 61,791 | ||
| Bank service charges and fees | 1,218 | 1,147 | ||
| Payment processing fee income | 19,249 | 15,168 | ||
| Other income | -2,684 | 204 | ||
| Other operating income | 17,783 | 16,519 | ||
| Salaries and related benefits | 46,300 | 39,058 | ||
| Occupancy expenses | 4,096 | 3,996 | ||
| Other expenses | 22,315 | 13,967 | ||
| Total other operating expenses | 72,711 | 57,021 | ||
| Income before provision for income taxes | 22,512 | 21,289 | ||
| Provision for income taxes | 6,774 | 6,165 | ||
| Net income | $ | 15,738 | $ | 15,124 |
This report includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical fact, included herein may constitute forward-looking statements. Although Commercial Bank of California believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct. Important factors that could cause actual results to differ materially from Commercial Bank of California’s expectations include fluctuations in interest rates, inflation, government regulations, and economic conditions and competition in the geographic and business areas in which Commercial Bank of California conducts its operations.
Commercial Bank of California
Member FDIC, Equal Housing Lender
